Refer to the information provided in Figure 32.3 below to answer ...

[Awilson837]

Question 1

The Lucas supply function, in combination with the assumption that expectations are rational, implies that an announced monetary policy change will

◦ not change output.
◦ decrease output, but never increase output.
◦ either increase or decrease output, depending on the type of monetary policy change.
◦ increase output, but never decrease output.

Question 2

Refer to the information provided in Figure 32.3 below to answer the question(s) that follow.








Refer to Figure 32.3. Suppose the economy is at Point 
A. According to the rational expectation theory, an unanticipated increase in money supply

◦ leaves the economy at Point 
A.
◦ moves the economy to Point 
B.
◦ moves the economy to Point 
C.
◦ moves the economy to Point 
D.

[chinwesucks]

Answer 1

not change output.

Answer 2

moves the economy to Point 
B.

[jhjkgdfhk]

Question 1

Refer to the information provided in Figure 32.3 below to answer the question(s) that follow.








Refer to Figure 32.3. Suppose the economy is at Point 
A. According to the new classical theory, an anticipated increase in aggregate demand

◦ leaves the economy at Point 
A.
◦ moves the economy to Point 
B.
◦ moves the economy to Point 
C.
◦ moves the economy to Point 
D.

Question 2

Refer to the information provided in Figure 32.3 below to answer the question(s) that follow.








Refer to Figure 32.3. Suppose the economy is at Point 
A. According to the rational expectation theory, an unanticipated decrease in money supply

◦ leaves the economy at Point 
A.
◦ moves the economy to Point 
B.
◦ moves the economy to Point 
C.
◦ moves the economy to Point 
D.

[Heffejeff]

Answer 1

moves the economy to Point 
C.

Answer 2

moves the economy to Point 
D.

[jhjkgdfhk]

TY

[Heffejeff]

You're welcome